ZEALAND PHARMA A/S (ZLDPF): Q1 2025 Earnings Signal a Strategic Pivot Toward Obesity Dominance

Zealand Pharma A/S (ZLDPF) has emerged from its Q1 2025 earnings call as a biotech on the cusp of transformation. The company’s collaboration with Roche, financial resilience, and robust clinical pipeline position it to capitalize on the booming obesity therapeutics market. This analysis dissects the key takeaways from the earnings transcript, weighing risks and opportunities for investors.

Financial Resilience: A Foundation for Growth

Zealand reported first-quarter revenue of 8 million DKK, modest but consistent with its reliance on licensing deals (notably with Novo Nordisk for Segalog). The headline grabber, however, is the $1.4 billion upfront payment from Roche, expected in Q2 2025. This will boost its cash reserves from 8.5 billion DKK to ~18 billion DKK, creating a war chest to fuel its pipeline without equity dilution.

Despite short-term stock volatility—closing at $64.51, down from $69.53—the InvestingPro analysis deems the stock “slightly undervalued” with a market cap of $4.5 billion. Analysts’ price targets, ranging from $110 to $169, suggest confidence in upcoming catalysts like betralentide’s Phase 2 data and Cervadutide’s cardiovascular trial results.

The Roche Deal: A Game-Changer for Obesity Therapeutics

The partnership with Roche is Zealand’s most significant strategic move to date. Under the terms:
- 50/50 profit sharing in the U.S. and Europe for betralentide, an amylin analog targeting obesity.
- Access to Roche’s CT388 (a GLP-1/GIP dual agonist) for combination trials, aiming to maximize efficacy and tolerability.

CEO Adam Steensper emphasized betralentide’s differentiation: its mechanism of action targets satiety, not appetite suppression, reducing gastrointestinal side effects like diarrhea. This could address a critical flaw in current therapies like Wegovy and Mounjaro, which often fail long-term adherence.

Phase 2 trials (ZUPREME-1 and -2) are underway, with topline data expected in H1 2026. A fixed-dose combination trial with CT388 is planned for early 2026, positioning betralentide as a cornerstone of Zealand’s “amylin franchise.”

Pipeline Momentum: Beyond Obesity

While betralentide steals the spotlight, Zealand’s pipeline extends to other high-potential programs:
- Cervadutide (dual glucagon/GLP-1 agonist):
- Phase 3 trials for obesity and non-alcoholic steatohepatitis (NASH) are nearing completion. Enrollment in the SYNCHRONIZED-CVOT trial was finalized in Q1, with data due in H1 2026.
- NASH, affecting ~1/3 of obese patients, lacks effective treatments. Cervadutide’s potential here could open a $10+ billion market.

• Dapaglutide (GLP-1/2 agonist):

• Phase 1b data to be presented at the American Diabetes Association’s June 2025 meeting, with Phase 2 trials planned.

• Glopaglutide (short bowel syndrome):

• A Phase 3 trial (EASE V) is scheduled for H2 2025, with an EU marketing application expected by year-end.

• Rare Disease Programs:

• Doziglucagon (congenital hyperinsulinism) faces a regulatory delay pending facility upgrades, but contingency plans are in place.

Risks and Challenges

• Competitive Landscape: Established players like Novo Nordisk (Wegovy) and Eli Lilly (Mounjaro) dominate the obesity space. Betralentide must prove its tolerability advantage in trials.
• Regulatory Hurdles: Delays in Cervadutide’s NASH program or manufacturing issues for rare disease candidates could disrupt timelines.
• Market Adoption: Only ~2% of eligible patients use pharmacotherapy for obesity. Education and reimbursement access are critical barriers.
• Economic Pressures: Inflation and interest rates may impact R&D costs, though Zealand’s cash position mitigates this risk.

Conclusion: A Buy With Catalysts Ahead

Zealand Pharma’s Q1 results underscore a strategically positioned biotech with financial strength, a diversified pipeline, and partnerships that could redefine obesity treatment. Key catalysts in 2026—betralentide’s Phase 2 data, Cervadutide’s CVOT results, and the Roche deal’s execution—present significant upside.

With $18 billion in cash post-Roche, Zealand can fund operations toward profitability while advancing its lead programs. Analyst consensus of a “strong buy” and price targets exceeding $160 align with this bullish outlook. Risks remain, but the company’s focus on unmet needs in obesity and NASH, paired with a 50/50 profit-sharing model with Roche, positions it as a leader in a market expected to grow to $100 billion by 2030.

For investors, Zealand Pharma represents a high-reward opportunity—provided upcoming trials deliver on their promise. The next 12 months will be pivotal, but the foundation is set for a generational play in peptide-based therapeutics.

Data as of Q1 2025. Always conduct independent research before making investment decisions.